Monday, 31 December 2018

GUEST POST - High Speed Rail 2 and it’s various effects on the Country

Today’s post is a guest post from
Teny Kuti, a first-year student in Aston University’s Law School. The post
discusses the various effects of the forthcoming HS2 high-speed rail link, as
well as some of the potential consequences moving forward. Please follow Teny
via Twitter here, and his own blog The Whole Spectrum
for an interesting take on a number of different issues, ranging from politics
to business.

Frequently described as the most substantial
rail project ever built in the UK set to open in 2026, High speed
rail 2 will form a high-speed link between Birmingham and London, reducing the
travel time to 49 minutes. However, the project has never been shy of controversy.
Since the HS2 received Government approval in 2012, it has seen strong
opposition from those who would lose their homes on the current plans and
indeed, HS2 Ltd has claimed that 1,740 buildings would be destroyed by the rail
line, with nearly 900 being homes. Now with the recent developments such as the
Chairman of the project resigning and claims that the
cost has been vastly underestimated from £56bn to potentially
£100bn, it becomes pertinent to discuss whether HS2 will have a positive or
negative impact on the country.

The rail line intends to link both
London and Birmingham, and then a phase 2 extension is planned to connect Leeds
and Manchester to the line. This could address many long running problems such
as the high house prices in London caused by a dense population living there.
The ability to travel from Birmingham to London in under an hour may allow for
people who work in London to seek cheaper housing in Birmingham without having
to suffer a 2-hour commute. As living in Birmingham becomes a more viable
option, this would reduce demand for homes in London thus causing prices to
decline, theoretically. Having an easy connection to London may also result in
more Businesses following in the footsteps of HSBC and relocating
to Birmingham, or potentially creating smaller satellite offices in the
city. However, this could result in Birmingham eventually sharing similar
issues currently facing London. As seen when
Deutsche Bank moved to Birmingham in 2014 the demand for homes increased
by two-thirds. This far exceeded the supply of houses and thus prices went up.
Should other high value firms follow Deutsche Bank and make the move to
Birmingham, it may just inherit the problems they were trying to escape.

The physical construction of the
rail line would result in jobs being created as the Department for Transport
claims that construction
of the project will create 25,000 jobs in addition to 100,000 people
working at the new stations and 3,000 jobs operating the trains themselves.
Naturally, these jobs would benefit the country as it allows people to earn a
wage and thus spend it in the country, improving the economy. However, the
construction of the line would also destroy 985 businesses that are
currently on the planned route of the line and thus, the people employed there
would lose their jobs. Specifically, HS2 Ltd claimed that 19,590 jobs would
need to be relocated but for those who were already earning a lower income in a
job that was integral to the location such as a farmhand, finding a new job may
be difficult. Although, the project is creating several times more jobs than it
is causing to relocate, thusly the rail line would have a positive impact on
the job market, as well as the benefits of a better-connected country.

The financial cost of the project
has recently been found to be much more than was previously stated, calling
into question how cost effective it currently is. The rail line was approved on
a budget of £56bn but it has recently been leaked that it may
increase to over £100bn due to underestimating how much the contractors
would need to be paid to complete the project in a timely manner. This has
renewed questions of whether this money could be spent on something more
effective. Many have criticised the project as being a way to circumvent the
existing problems in the transport network. The money used on HS2 could also be
used to fix potholes, upgrade the existing train services, or expand bike and
bus services. These projects would not require the compulsory purchase of land,
nor would it destroy people’s homes and businesses. HS2 Ltd has also faced numerous
claims of undervaluing the land that they need to buy resulting in families
and Businesses being forced to move out, but without enough compensation from
the Government to relocate. Not only is this damaging to the individuals it
directly affects, but it also proliferates an anti-Government sentiment which conflicts
with the sense of interconnected national pride they hope to achieve with HS2.

The environmental impact is also worthy
of discussion as with any train, the transport is more environmentally friendly
if it is replacing transport by car given that one train can take hundreds of
people. However, High
Speed Rail itself is not significantly better for the Environment
than a normal train. Indeed, the methods used to construct the rail line are
certainly not environmentally friendly and thusly, it is possible that HS2 may
do more damage to the Environment when considering the wildlife disrupted and
trees cut down. Given that the primary users of HS2 would likely be using a
normal train otherwise, the environmental impact of HS2 is likely to be
negative but to a minimal degree, largely due to the harm done during
construction.

HS2 is going to have a profound far
reaching effect on the UK ranging from the country wide economy to a family of
farmers in Buckinghamshire. The rail line seems to have a net positive impact
on the economy if it produces the amount of jobs they expect, this should
offset the amount of people who have lost their jobs or need to relocate. The
rail may also relieve some of the pressure on London as the hub of the largest
service firms. Should these firms choose to move to Birmingham and eventually
to Leeds and Manchester, this would benefit the economies of these individual
cities while decreasing the price of housing in London, but also increasing the
price in these various cities. When the UK gains the benefit of this economic
increase is dependent on whether the project remains on budget, though this
seems unlikely and the potential for it to go over budget is supported by the
resignation of its Chairman in early December. Ultimately, HS2 should have a
positive effect on the economy, but a negative effect on individuals and small
business owners who are an obstruction to the most substantial rail project
ever built.

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